TEXT
FOR DELIVERY: 9:30 A.M., E.S.T.
FRIDAY, DECEMBER 8, 1995
___________________________________________________________
Advance copies of this statement are made available to the
press under lock-up conditions with the explicit
understanding that the data are embargoed until 8:30 a.m.
Eastern time. ____________________________________________
Statement of
Katharine G. Abraham
Commissioner
Bureau of Labor Statistics
before the
Joint Economic Committee
UNITED STATES CONGRESS
December 8, 1995
Mr. Chairman and Members of the Committee:
I appreciate this opportunity to comment on the labor
market data released this morning.
Payroll employment rose by 166,000 in November, as job
growth in the service-producing sector of the economy more
than offset continued declines in manufacturing. The
unemployment rate was little changed at 5.6 percent.
Although the reported November job growth is somewhat
above the average monthly gain since March of this year, the
increase was exaggerated by two technical factors. First,
the timing of the November survey reference period resulted
in there being 5 weeks between the October and November
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surveys, instead of the more usual 4-week interval. The
extra week led to our picking up more of the seasonal
employment changes in certain industries, particularly the
buildup in retail trade, than was expected by our seasonal
adjustment process. We estimate that the net effect was to
add about 25,000 to the over-the-month change in total
nonfarm employment.
Second, as is our normal practice, with the release of
November payroll data, we have introduced new seasonal
factors for the period from November through next April.
While the November payroll survey estimates reflect these
new factors, data for prior months have not yet been
reseasonalized. The effects of this updating in seasonal
factors normally are minimal. Had recalculated factors also
been used to adjust this October's data, however, the total
increase in payroll employment between October and November
would have been 44,000 smaller.
Taking these two factors into account, the November
payroll employment increase appears to be roughly in line
with the gains evidenced in recent months.
Turning to the industry employment detail, the largest
increase occurred in the services industry. There were
strong gains in health services and in engineering and
management services, but employment in business services
showed virtually no growth for the second month in a row, as
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continued declines in its help supply services component
substantially offset gains among other business services.
The number of employees engaged in wholesale trade
expanded, with the increase concentrated among durable goods
distributors. In transportation and public utilities,
employment rose in November, mostly due to job growth in
transportation. The finance industry added jobs over the
month, as low interest rates continued to boost home
mortgage activity. In retail trade, employment rose by
74,000, but most of this apparent gain reflected the
technical factors I have already discussed.
In the goods-producing sector, employment in
manufacturing fell by 32,000 in November, as the industry
continued to shed workers. Since its recent peak in March
of this year, the manufacturing industry has lost about
220,000 jobs (after adjusting for about 35,000 factory
workers who recently went off payrolls because of strikes).
An unusually large November decline occurred in auto
manufacturing, where several plants have been idled because
of excessive inventories. The apparel industry continued
its long-term pattern of job loss; over the past year, the
job total in the industry has fallen by 86,000. Small over-
the-month declines occurred in many other manufacturing
industries. In contrast, employment in industrial machinery
continued to expand in November, and this industry has added
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55,000 jobs over the past year. The manufacturing workweek
and overtime hours were unchanged in November.
Construction employment held fairly steady over the
month, as colder-than-usual weather in the eastern half of
the country hindered some building activity. The underlying
trend in the industry in recent months has been one of
modest expansion. In mining, employment continued to
decline in November, mostly in oil and gas extraction.
I also should point out that the hourly earnings series
from our payroll survey edged down in November, after having
posted strong gains in 4 of the prior 5 months. Over the
year, hourly earnings have increased about 3 percent.
As I noted at the beginning of my remarks, the
unemployment rate was little changed in November at 5.6
percent. The jobless rate has held at or near its present
level for much of this year, and the unemployment rates for
major worker groups have followed a similar pattern. Most
other labor market indicators from the household survey
showed little over-the-month change. The survey estimate of
total employment did decline in November, but this series
often fluctuates considerably from month to month, and we do
not attach much significance to this movement.
Before closing, I would like to comment briefly on the
impact of the recent federal government shutdown on the
November data. Due to the timing and nature of our
collection procedures, the federal shutdown had no effect on
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this month's establishment survey data. In the household
survey, however, which is conducted for us by the Bureau of
the Census, data collection operations were delayed by
several days because workers there were furloughed. It is
only because of extraordinary efforts on the part of Census
Bureau employees upon their return to work that enough
household interviews were completed to provide us with an
adequate sample. We do not believe that the quality of the
household survey data for November was seriously compromised
by the delayed collection.
In summary, overall employment rose in November, with
gains occurring in the service-producing industries.
Manufacturing employment, however, continued to decline.
The unemployment rate was basically unchanged at 5.6
percent.
My colleagues and I now would be glad to answer your
questions.